ifo Dresden: Workers from Countries That Joined the EU in 2004 Fill Gaps in the German Labor Market

In 2004, most existing EU member states placed restrictions on the free movement of workers from these new Central and Eastern European member states. In Germany, these measures weren’t repealed until 2011. Ragnitz adds: “Workers from these countries currently have quite a minor role in reducing labor shortages in demanding jobs. This probably has to do with the fact that highly qualified people also have good labor market opportunities in their home countries and are likely to receive above-average pay there. But many of the workers from these countries don’t have the relevant qualifications in the first place.  

“This means that as demand for skilled workers continues to grow in the years ahead, workers from the Central and Eastern European accession countries are unlikely to do much to meet it.” At present, 48% of this group are employed in skilled work, 42% are assistants, 5% specialists, and 5% experts.  The median salary across all these nationalities and employment groups is just EUR 2,580 per month, while the average for all employees in Germany is EUR 3,650 per month.

Workers from the countries that acceded to the EU in 2004 are concentrated in transport and logistics companies (14%), in temporary employment (11%), and in the construction industry (11%). Their share is disproportionately low in more demanding service occupations, in trade, and in the hospitality industry.

Of the 820,000 workers, 65% come from Poland. These workers are more or less evenly distributed throughout Germany, but with a preponderance in the districts along the German-Polish border and in some regions of northwestern Germany characterized by agricultural production. They represent 12.3% of all workers employed in the city of Frankfurt an der Oder and 12.0% in the district of Teltow-Fläming south of Berlin. The second largest group – 14% – is made up of workers from Hungary. They are followed by the 8.4% from the Czech Republic, who represent a particularly high share of workers in the border districts of Tirschenreuth and Cham (at 12.6% and 13.2%, respectively).

On May 1, 2004, Poland, the Czech Republic, Hungary, Slovakia, Slovenia, Estonia, Latvia, Lithuania, Malta, and Cyprus joined the EU.